Once you understand the basic options trading strategies, you'll be able to easily apply them to almost any market, whether stocks, futures, forex or even the cash markets of say, gold or bonds. In what follows, we will concentrate on futures options only because they provide trading opportunities across a diversity of commodity markets, many of which are in the current headlines and are of particular interest to many investors.

OPTIONS ON FUTURES

Since this site is designed for the beginner, we will confine our attention to just buying futures options, whether calls or puts, and buying option spreads. These option strategies have the advantage that risk of loss is known and limited yet they still provide the versatility to trade essentially any price expectation. Selling options naked, meaning that the option position is not protected or hedged by another, offsetting position whether that be another option or even a futures contract, entails risk similar to that of an outright futures position and may not be appropriate for the beginning options trader. More information on commodity futures trading can be found under the content index pull-down menu on the blue WLF Network Navigation Bar at the top of the page.

Consequently, this site, by choosing to focus on buying futures options, differs from most other option-related sites. Beyond this, there are two other features that distinguish this options trading site from others:

Firstly, only those options trading strategies most relevant to the beginning trader are explored. The criteria are that the strategies must have limited risk, be fairly easy to understand and, for those with modest amounts of trading capital, be affordable. While some extended options strategies are introduced with further details freely available by request, they are not allowed to confuse or overwhelm the main educational objective.

Secondly, the site gives considerable attention to the practical aspects of buying futures options. So, in addition to theory, the beginning options trader will find topics on deciding the proper option-buying strategy, executing the option purchase, managing the options trade and even how options are treated in the account statement. The strength of this content draws from the author who has experience trading futures options.

While this web site was designed to be accessible to all, especially the beginning options trader, that is not to say that trading futures options is appropriate for everyone. As with any type of investment, it should be carefully considered along with your personal tolerance for risk and available risk capital. This web site will help you make an informed decision.